Asking prices fall at the start of autumn for first time since 2010
The average price of property coming to market fell by 0.2% in September, the first price decline recorded at this time of year since 2010, the latest residential index shows.
September is usually the start of an autumn bounce in housing market activity but uncertainty is causing some to hesitate and this is expected to heighten ahead of the Brexit deadline in October, according to the asking price index from property portal Rightmove.
Overall the data shows that asking prices are now 1% below September 2018 at an average of £304,770. But first time buyers face paying more with asking prices in this sector up 0.2% month on month and 0.7% year on year.
The data also shows that the number of properties being put up for sale fell by 7.8% compared with September 2018 with the decline affecting all regions. The number of sales agreed also fell nationwide, down by 5.5%, a reversal of the rise of 6.1% a month ago.
The current market conditions gives autumn buyers who keep their nerve a better negotiating opportunity, according to Miles Shipside, Rightmove director and housing market analyst. ‘As we approach yet another Brexit deadline, there are signs of hesitation. But those who are planning to buy or trade up and can keep their nerve whilst others hesitate may find that they are in a stronger negotiating position to get a favourable deal,’ he said.
He pointed out that it appears that August saw a pre-Brexit buying spree with the number of sales agreed up by over 6% compared to the prior year, as buyers and sellers decided to get deals secured well before the next Brexit deadline.
‘A month later, as the deadline gets closer and tensions heighten, there has been a big swing the other way with sales agreed numbers now over 5% below those of a year ago. Buying activity is still at nearly 95% of what it was a year ago, but sellers in all regions are seeing fewer sales go through, so should be more willing to negotiate with prospective buyers if they want or need to get a deal done,’ Shipside added.
He also pointed out that while the number of newly marketed properties is down by 7.8% this month compared to the same period a year ago, the market is influenced by what’s happening in London, where there is a drop of more than 20% in new properties coming to market as some owners await a Brexit outcome and market recovery.
‘Some regions are just marginally behind the previous year, but they are all seeing less activity in these two key metrics, showing that hesitation is now more widespread rather than being localised. However, some of that will be due to difficulty in finding the right property to buy, as activity still remains brisk in some locations, evidenced by continuing upwards pricing pressure in some parts. Uncertainty is clearly not just about the political situation, with finding the right property to buy being a bigger worry for many,’ Shipside explained.
And he also explained that the national average is dragged down by parts of the South. London has properties now coming to the market at an average of 2.1% cheaper than a year ago, with the South East region also in negative territory with a fall of 1.1%. All other regions have new seller asking prices up compared to a year ago, with the North West being the most buoyant with a rise of 3.5%.
‘There is some year on year bounce occurring in prices in the North West, and also in the North East, Yorkshire and the Humber and Wales, which all have new sellers asking at least 3% more than at this time last year. Buyer affordability and investor activity create and maintain market momentum, but these factors are lacking in parts of the South,’ said Shipside.